Apple will let US merchants link to payments on the web, but Apple will still take their cut

Posted by Matt Birchler
— 2 min read

You should read Chance Miller’s whole article on 9to5Mac, but I wanted to share my immediate thoughts after seeing this.

Apple is updating its App Store guidelines to allow developers to link to alternative payment methods, provided that the app also offer purchases through Apple’s own In-App Purchase system.

First off, this is an annoying limitation that could undo much of the usefulness of this change. It’s certainly better than not letting merchants tell their customers how to buy their product, but it does require that anyone doing this has at minimum 2 payment sources to manage.

The good news comes in the examples Apple gives for how app developers can describe their payment link in apps. Here’s one:

Lower prices offered at [X]

This at least allows merchants to incentivize people to pay on the web by giving them a lower price. Several companies like YouTube already do this since they don’t have to offset Apple’s 30% cut on the web, but now they can say it explicitly, which I like.

In theory, a merchants could make a $1,000 in-app purchase, but offer $10 when paying online, which would effectively move all of their purchases to their website, but I’m kinda skeptical that’s going to fly with Apple.

Apple has also confirmed that it will charge a commission on purchases made through alternative payment platforms. This commission will be 12% for developers who are a member of the App Store Small Business Program and 27% for other apps.

And there’s the other shoe that’s dropped…just like they did for dating apps in the Netherlands, Apple is only letting you get out of the payment processing fee, you still owe them their 12% or 27% “finder’s fee”.

The commission will apply to “purchases made within seven days after a user taps on an External Purchase Link and continues from the system disclosure sheet to an external website.”

I continue to think this is ridiculous and is something Apple does specifically to discourage people from doing it in the first place. “Who wants to do all that paperwork, anyway? What a pain, we may as well use Apple’s payments.” 🙄

Apple can’t see what happens on your website, so it can’t track this themselves, so they put the burden on the merchants to self-report this data. How accurate is it? How incentivized are merchants to report accurate data? How often will Apple audit merchants who they think are lying in their payments back to Apple? No idea, and truthfully, neither does Apple.

Apple also says that collecting this commission will be “exceedingly difficult and, in many cases, impossible.”

I don’t feel like I’ve seen any reporting on how this has gone in the Netherlands yet, but this reeks of being an accounting nightmare for everyone involved. I really think Apple needs to cut this out and recognize that they don’t need to earn a commission on every penny spent on their platform.

Apple sold more iPhones last year than any other smartphone maker in the world and iOS is the leading computing platform in the United States where this rule is going into effect. If they were a tiny upstart struggling to get by, then their stringent rules around taking a third of all money made in their apps would be more understandable, but being historically, unbelievably successful comes at the small cost of looking like a landlord when you nickel and dime people trying to build on your platform like this.

Forget about this 12/27% collection agency you need to open inside Apple to deal with these payments, and then I’m overjoyed with the change! We’ve made some progress today, but I still hope Apple loosens their restrictions more down the line. History tells us they won’t do it on their own, so I guess I’m hoping for more regulatory pressure.